Don't let it get away!

Patients with nonvalvular atrial fibrillation (afib), a common heart rhythm disorder not caused by a heart valve problem, may get a new lease on life. A new device from Boston Scientific (NYSE: BSX) is up for another review by the FDA for its ability to prevent stroke or systemic embolism, two risk factors affecting afib patients.

The Watchman transcatheter left atrial appendage closure device, also known simply as the Watchman device, was initially rejected three-and-a-half years ago due to safety concerns. The FDA is expected to examine new data that has been accumulated and look for evidence that the device is reasonably safe, effective, and has a positive benefit-risk profile for the preventive treatment for stroke and systemic embolism.

Watchman device's initial trial raised safety issuesIn its first major trial, the PROTECT AF trial, the Watchman device was found to be no worse than another treatment currently on the market, warfarin, in its protection against stroke, cardiovascular (CV) death, and systemic embolism. Warfarin is an anticoagulant taken orally that decreases the blood's clotting ability. It is difficult for some patients to tolerate and can lead to bleeding complications.

Upon review, the device presented an increased risk of bleeding and other complications. The FDA initially approved the device in 2009, but overturned its decision in 2010 due to safety concerns and lack of "reasonable assurance of the device safety and effectiveness."

After rejection, new data gathered shows promiseThat sent device maker Boston Scientific (NYSE: BSX) back to the drawing board to design a new trial, PREVAIL. The new trial addressed some of the problems of the old and results released earlier this year showed that it met the primary safety endpoint of a 2.2% rate of death or other device-related complications. Vascular complications in PREVAIL were about half of those seen in PROTECT AF .

According to Zacks Investment Research , FDA approval will open up the device's market availability beyond its investigational use. This will allow Boston Scientific to potentially dominate the market, since the device is the first of its kind. Wells Fargo analyst Larry Biegelsen told Bloomberg Businessweek that within the $400 million market for devices that close the heart's left atrial appendage , the device could generate about $162 million in worldwide sales by 2017.

Device receives recommendation, but indication may need adjustingOn Dec. 11, 2013, the majority of an FDA advisory panel voted favorably (13 to 1) that the device's benefits outweighing its risks, its safety, and the reasonable assurance of the device's efficacy . The FDA will consider the panel's recommendation during its approval process. Also of interest are longer-term results from PROTECT AF that were reported earlier this year which showed a significant improvement in the rate of stroke, CV death, or systemic embolism over the course of four years for patients using the Watchman versus warfarin .

The company's indication for the Watchman device states that it's intended to serve as another treatment option for patients not eligible for warfarin therapy. The indication could be questioned because in the years the device has been under development, other anticoagulants have entered the market. These therapies include Xarelto, manufactured by Bayer AG (NASDAQOTH: BAYRY) , and Eliquis, made by Bristol Myers Squibb (NYSE: BMY) .

How do the newer anticoagulants fare?Bayer's Xarelto has provided strong results for the company – sales in 2013's third quarter rose a whopping 219% from the third quarter in 2012. The drug had the third-highest sales figure among Bayer's best-selling pharmaceuticals and made up 12% of total sales within the group. Bayer noted the rapid increase in the drug's business, making it a global leader among the newer anticoagulants in the market; this was especially evident in Japan, Germany, and France . Patients may prefer Xarelto over warfarin because the drug does not required routine blood tests and there are no dietary restrictions .

Eliquis is also considered a better therapy for afib than warfarin for certain patients. Bristol Myers Squibb noted in its third quarter earnings release that new study results show that patients with or without certain types of valvular disease showed reduced stroke, systemic embolism, and bleeding events when taking Eliquis . Like Xarelto, Eliquis does not require routine blood testing. The drug's sales have risen steadily since its approval in 2012 – third quarter 2013 sales totaled $41 million and $75 million year-to-date .

My Foolish conclusionBoston Scientific's Watchman device is the first of its kind to hit the market and could be a product that provides the company with a substantial return on its investment. With more than five million people affected by this condition, there's a large market that can benefit from this device.

With competitors lagging in the development of their own heart defect closure devices, the company could maintain a monopoly in this market for the next few years. Its closest competitor, a similar device made by St. Jude Medical, may reach the market by 2017. Meanwhile, Boston Scientific expects FDA approval of the device by the first half of 2014. The device already received the CE Mark in 2005, so the European Union has already given the green light .

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